TEN years ago, when bombs ripped through two nightclubs in Bali, Australia knew frighteningly little about the group behind the attack, the now-infamous Jemaah Islamiah, or JI.

''The knowledge and understanding of the intelligence community about JI prior to the 12th of October, 2002, was such that it would have fitted on an A4 piece of paper,'' says former Australian Federal Police commissioner Mick Keelty.

Not only was there a dearth of information regarding JI before the al-Qaeda attacks in 2001, the entire system of national security in Australia was underfunded and, many believed, undervalued.

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In 2001, the country's foremost security agency, the Australian Security Intelligence Organisation, attracted $69 million in government funding.

A decade later, not only had its funding had a precipitous rise to $438 million - an increase of 535 per cent - today its new, expansive and soon-to-be-occupied headquarters is one of the most instantly recognisable buildings in Canberra.

Sparked at first by the horrors of September 11, 2001, and then brought devastatingly home when JI detonated a combination of truck and suicide bombs, today Australia has one of the Western world's most expansive national security regimes.

''Going back to 2001 and 2002, terrorism wasn't even an offence in most jurisdictions,'' said Tim Morris, the officer who led the investigation into the Bali bombings and who today runs the federal police's intelligence network.

''If you don't have an offence, you don't have investigators investigating, you don't have intelligence specialists developing knowledge. When you think we came from pretty much a standing start in 2001, 2002, to where we are today, it's quite an achievement.''

Since 2001, 111 Australians - including 88 in Bali - have been killed in terrorist acts. In the same period, 36 people have been charged with terrorism offences and, according to ASIO, four potential terrorist attacks have been foiled.

Accompanying the successes, however, have been some well-publicised mistakes, such as the case of the Queensland doctor Mohamed Haneef. Dr Haneef was mistakenly charged with a terrorism-related offence and kept in solitary confinement for almost a month in 2007.

Ben Saul, an expert in anti-terrorism law at Sydney University, said that while most Australians accepted the need for increased powers and laws in the early 2000s, some laws enacted in the rush after Bali could no longer be justified.

He said the laws included compulsory questioning and detention powers by ASIO, preventive police detention, control orders and some elements of the ever-expanding surveillance and interception powers.

Professor Saul bases his judgment on the relative risk faced in Australia. ''If you look around the world, most other countries haven't gone as far as Australia, despite facing more significant risks,'' he said.

Most of those laws were introduced as part of the John Howard-era Anti-Terrorism Act, which passed Parliament in December 2005.

Despite some objections during opposition, this year the Labor government of Julia Gillard displayed its willingness to legislate in the area when it revealed a suite of more than 40 proposed legislative changes - the most significant expansion of national security powers since the 2005 laws were introduced.

The new proposals would further break down some of the most fundamental divisions between Australia's six intelligence agencies.

For six decades, ASIO has been the only agency authorised to routinely collect intelligence on Australians. However, under the proposed changes, officers from the Australian Secret Intelligence Service and the Defence Signals Directorate would be allowed to monitor Australian citizens overseas if an ASIO officer was not available.